UNFI short interest is at an absurd 23%. The shorts were hoping for some more bad news. They stayed too long. Earnings (exluding items) is .37, analysts expected .30 !!! Earnings/Revenue for 2009 show company is back on a growth track. If longs hold onto their stock, there will not be enough float available for the shorts to cover!! They pushed the stock down to this absurd level, now the ones that stayed too late will have too pahy the price.
There are 9 MILLION shares short. That's a LOT of interested buyers. Eventually, they will have to unwind their positions.
The only thing priced into this stock for the last 6 months or so is excessive (probably illegal naked ) shorting. The stock should never have dipped down below 20 like it did. Let's assume that UNFI can grow at a 15% rate for the next several years (probably too conservative). As the PE drops, not only is it a growth stock, but it is even a VALUE stock. This will bring in plenty of buying.
How do you think 9,000,000 shares can be unwound???
Give me a break!! This has been a long time coming. There are 9 MILLION shares short. A lot of the smart money is already out of their short positions. As the consumer economy grows in the next year, organic foods are going to boom. The FDA is helping this to happen by pushing to aprrove massive food irradiation of fresh produce. This will produce a nationwide surge in organic food sales as the folks who are familiar with the studies on this completely quit buying conventional foods. These irradiated foods will not be labelled as such when put out for sale if the FDA gets their way!! The company is back on a growth track - shorts better figure out their exit strategy now!!